AMD beats Q3 revenue and EPS, but gross‑margin guidance merely meets expectations

AMD reported third‑quarter numbers that beat Wall Street estimates on both revenue and earnings per share, but the company’s gross‑margin outlook did not come in stronger than expectations.

That was enough to push the stock lower in extended trading.

The company said adjusted earnings per share came in at $1.20, beating the $1.16 consensus. Revenue reached $9.25 billion, ahead of the $8.74 billion estimate. Revenue rose 36% compared to the same quarter last year.

The quarter ended on September 27. Net income was $1.24 billion, or 75 cents per share, up from $771 million, or 47 cents per share, in the same quarter a year ago.

For the fourth quarter, AMD guided to about $9.6 billion in revenue, which implies 25% growth year over year.Analysts were expecting around $9.15 billion.

The company said it expects an adjusted gross margin of 54.5%, which matched StreetAccount’s forecast.AMD repeated that the guidance does not include any revenue from shipments of its Instinct MI308 chips to China.

Executives said during the release, “We are not including revenue from China‑bound MI308 shipments in the outlook at this time,” repeating the same stance from last quarter. AMD shares had climbed 107% year‑to‑date ahead of these results, while the Nasdaq had risen 21% over the same period.

AMD outlines major AI infrastructure partnerships

AMD reached a strategic agreement with OpenAI last month. The arrangement could lead to OpenAI holding as much as 10% of AMD.As part of the deal, OpenAI plans to deploy 6 gigawatts of AMD Instinct GPUs across multiple chip generations.

The first 1‑gigawatt portion is expected to roll out in the second half of next year. For years, OpenAI and many other AI developers primarily used Nvidia GPUs to train and run large models. The shift signals growing supply and ecosystem diversification.

Oracle said in October it plans to deploy 50,000 AMD Instinct MI450 chips in its cloud next year. AMD also introduced its new “Helios” rack‑scale design and said it supports the Open Rack Wide standard introduced by Meta at the Open Compute Project Global Summit.

Cisco and AMD expanded their collaboration with G42 to build a large‑scale cluster in the UAE using AMD Instinct MI355X GPUs.IBM and AMD announced a multi‑year effort to support Zyphra with clusters running AMD Instinct MI350X GPUs for multimodal models.

Cohere is increasing its use of AMD Instinct GPU infrastructure across its enterprise lineup.Vultr said AMD Instinct MI355X GPUs are now available across its cloud network.

DigitalOcean expanded cloud offerings to include AMD Instinct MI325X now and MI350X later this year. Tech Mahindra will bring AMD Instinct GPUs and AMD EPYC CPUs into its Cloud BlazeTech platform.

The U.S. Department of Energy announced two upcoming supercomputers based on AMD hardware. The Lux AI system will use AMD Instinct MI355X GPUs, AMD EPYC CPUs, and AMD Pensando networking.

The Discovery system, expected in 2028, will run on next‑gen AMD EPYC “Venice” CPUs and AMD Instinct MI430X GPUs, part of AMD’s new MI400 Series.

Data center, client, and gaming segments show broad growth

AMD’s data center business generated $4.34 billion in revenue in the quarter, up 22%. Analysts were expecting $4.13 billion. Client revenue came in at $2.75 billion, up 46%, beating the $2.61 billion consensus.

Gaming revenue totaled $1.30 billion, up 181%, above the $1.05 billion estimate. Amazon, a meaningful cloud customer, disclosed in a filing that it sold all 822,234 of its AMD shares as of September 30.

The position was originally built in the first quarter. AMD released ROCm 7 software to improve training and inference performance. The company also completed the divestiture of its ZT Systems data center manufacturing business to Sanmina.

AMD partners expanded cloud services powered by 5th Gen AMD EPYC processors. AWS said its new Amazon EC2 M8a instances deliver up to 30% better performance than the prior generation.

Oracle introduced new X11 platforms powered by the same processors. IBM and AMD also announced plans to combine quantum computing with high‑performance compute in future architectures.

AMD updated its PC and gaming lines with Ryzen Threadripper 9000WX, Threadripper PRO 9000X, and FSR 4. FSR 4 support doubled to more than 85 games.

The company expanded its embedded line with AMD EPYC Embedded 4005 and Ryzen Embedded 9000 processors for industrial and edge computing.

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